Winn Bay Sand acquired 3,082 acres of leases in the Hanson deposits in 2004, according to media reports.
Preferred Sands did not disclose how it will finance the deal. Mergers & Acquisitions Journal reported in November that the company was seeking a $430 million senior secured credit facility to pay for an acquisition, buy out minority investors, and refinance existing debt.
Preferred Sands got into the frack-sand business in 2007 with the acquisition of an 80 million-ton reserve in Nebraska. It later acquired mines in Arizona and Minnesota and has the capacity to produce 2.1 million tons of sand a year. It also owns 1,500 railcars, according to its website.
The demand for special sand used as "proppant" in hydraulic fracturing has soared along with the drilling boom in formations like Pennsylvania's Marcellus Shale. Water, sand, and chemicals are forced under high pressure into shale formations, where the sand props open tiny fractures, allowing gas and oil to flow into the well.
Sand from Midwestern mines is desired for hydraulic fracturing because the spherically shaped grains flow smoothly into wells and allow oil and gas to escape easily.
A typical Marcellus well requires 2,500 tons of sand, enough to fill 25 railcars. Nationwide, the annual market for proppant is about 40 million tons.
But sand mines have increasingly become the target of anti-drilling activists as political opposition to shale gas development has mounted. Neighbors of the mines have also complained about increases in dust pollution and traffic at the facilities.
Preferred Sands in November filed plans to boost its sand-mining operations near Cooks Valley, Wis., where it has a 225-acre quarry. Those plans have already attracted opposition.
The acquisitions announced Wednesday will allow Preferred Sands to increase capacity to serve existing customers, according to its statement.
Both the Wisconsin and Canadian mines are near existing Preferred Sands operations and are served by rail facilities.
Preferred Sands said it would keep Winn Bay Sand's 110 employees. It plans to expand both of the newly acquired plants in 2012.
Contact staff writer Andrew Maykuth at 215-854-2947, @Maykuth on Twitter, or firstname.lastname@example.org.